Domestic Consumer Price Research Articles

Impact of the Russian-Ukrainian war on the European economy

ABSTRACT The article aims to identify the origin of the key sources of economic threats to Europe as a result of the Russian invasion, evaluate them and suggest ways to minimise or eliminate such threats. The methods of establishing cause-effect relationships, analysis, synthesis, graphical and cartographic methods, statistical analysis, analysis of dynamics and structure were all used. The background and causes of the war were considered, the economic consequences for Ukraine, including damage to the population and infrastructure, trends in the dynamics of gross domestic product, exports, imports and consumer prices were studied.

Studying the economic burden of premature mortality related to PM2.5 and O3 exposure in Greece between 2004 and 2019

The detrimental direct effects of air pollution on public health have been well-determined; however, of relevant importance are also the indirect effects on the economy. Based on the value of statistical life (VSLs) and the willingness to pay (WTP) method, we estimated the economic cost resulting from premature mortality associated with fine particulate matter (PM2.5) and ground-level ozone (O3) exposure across Greece during 2004–2019, under a constant and a changing income elasticity scenario. The spatiotemporal trends of the economic burden were also investigated. The total economic burden attributable to premature mortality due to exposure to PM2.5 and O3 for the 16-year period was estimated at € 66.34 billion under the constant scenario and at € 273.65 billion under the changing scenario. A dramatic decline of the mortality cost was observed from 2009 to 2019 in the changing scenario, reflecting various socio-economic factors and income losses, as opposed to a less profound downward trend under the constant scenario, where the annual Gross Domestic Product (GDP) and Consumer Price Index (CPI) variances were not taken into account. During the study period, PM2.5 contributed the most to the economic loss, while the contribution of O3 was much less. The spatiotemporal patterns observed here may prove an effective means of communicating these trends to policy-makers and may feed the design of strategies for protecting public health and safeguarding the economic growth.

FOREIGN ECONOMIC STRATEGIC PRIORITIES OF UKRAINE

The paper is devoted to the analysis of modern foreign economic strategic priorities of Ukraine, features of their implementation in the context of the key purposes of economic development of the country. Emphasis is placed on the need to use modern tools to support domestic producers and limit import expansion in the context of the formation of a new export strategy of Ukraine. Ukraine is a small open economy that makes extensive use of external factors of economic development both in the context of markets for its products, especially the agricultural sector, and attracting important resources of critical imports, including oil and natural gas, electronic equipment and more. From this point of view, the analysis has revealed the role and importance of two key players in the world market – the United States and China – in ensuring Ukraine’s external economic balance. The paper empirically examines the dependence of certain macroeconomic indicators of Ukraine on similar indicators of the United States and China (the so-called ‘large’ and systemically important economies for Ukraine). Vector autoregression models were used as a research tool to explore the dynamic interdependencies between macroeconomic indicators in the case of explaining their present values by the previous ones. For this purpose, percentage changes in gross domestic product and consumer price index compared to the corresponding period of the previous year for the USA, China and Ukraine were selected. As a result of the research, impulse-response functions from ‘large’ economies showed the dependence of indicators that characterise economic development in Ukraine from them and their long-term absorption, both in the context of economic growth in these countries and inflation imports from abroad. Moreover, it should be noted that the influence of China is more significant than that of the United States, especially if we consider the impact of fluctuations in the consumer price index in China on economic growth and inflation in Ukraine. This necessitates further research on this issue in line with the formation of scientifically sound foreign economic strategy and policy of Ukraine. The impact of economic growth in the United States and China on Ukraine’s GDP fluctuations is positive and almost the same (peaking in the second quarter and gradual levelling over two years). In turn, the variance decomposition of forecast errors for Ukraine’s GDP shows that in the long run about 52% of its variability result from modelled external factors, which in our opinion is due to significant openness of Ukraine’s economy and, consequently, ‘large’ economies. Finally, paper emphasizes the need to assess their international economic policy to minimize risks in the implementation of the country’s foreign economic strategy.

LOW EXCHANGE RATE PASS - THROUGH IN THE UNITED STATES, ECONOMY - WIDE AND IN AGRICULTURE

We provide evidence of low pass-through of exchange rates into domestic prices in the United States, both within agriculture and economy-wide, from 1970 to 2022. Exchange rate pass-through is defined as the extent to which a change in exchange rates translates into a change in domestic prices. We revisit the question of exchange rate pass-through into domestic producer and consumer prices. With food inflation being one of the major areas of concern, and with trade playing a disproportionately important role in U.S. agriculture , we also investigate exchange rate pass-through for agricultural prices as well as for prices in the general economy. Our estimation strategy does not use cross-sectional variation, but instead exploits variation over time in exchange rate indices and price indices. Most of our estimates of pass-through are not significantly different from zero, and we are almost uniformly able to reject the hypothesis of complete pass-through. Our findings suggest that any further increases in the value of the U.S. dollar will have little effect on inflation rates in the United States, in agriculture or economy-wide.

Perceived economic prospects during the early stage of COVID‐19 breakout

AbstractHow does a new epidemic affect individuals' expectations on economic prospects in the early stage of the breakout? We implemented an incentivized longitudinal online survey soon after the outbreak of the coronavirus disease 2019 (COVID‐19) epidemic in China to answer this question. Results show that fewer new confirmed COVID‐19 cases significantly increase individuals' expectations on gross domestic product and consumer price index growth rates. Our finding provides evidence that at the early stage of an unfamiliar epidemic, containing the spread of the disease may help to maintain positive economic expectations among individuals.

Macroeconomic effects of demand and supply shocks in the global oil price on the Vietnamese economy

PurposeThe purpose of this paper is to examine the effects of several structural shocks in oil prices on the Vietnamese economy and answer three key research questions: Is there a relationship between oil price shocks and macroeconomic indicators in Vietnam? How do different types of oil price impulses affect Vietnamese inflation and economic performance? To what extent do structural shocks in oil prices explain variations in Vietnam’s macroeconomic indicators?Design/methodology/approachLower triangular Cholesky decomposition is performed on a short-term impact matrix in a two-block structural vector autoregressive model. The data set is defined monthly, from January 2000 to December 2021. The contributions of structural shocks in oil prices to the domestic variances are analysed using variance decomposition methods. In this study, both forecast error variance decomposition and historical decomposition are used.FindingsThe consequences of oil price fluctuations on Vietnamese output and inflation depend on different sources of oil price shocks. In comparison, oil supply shocks have an insignificant effect on both domestic industrial output and consumer price index inflation; however, positive shocks in aggregate and precautionary oil demands increase these domestic indicators substantially and sustainably. An analysis of variance decompositions reveals that supply-side oil shocks have very limited explanatory power for variations in domestic variables. Nevertheless, the contributions of unanticipated demand-side booms to domestic variations in the past and projected forecasts are considerable.Research limitations/implicationsThe findings from this research uncover potential risks for Vietnam’s economic prospects if the consequences of oil price shocks are not managed effectively.Originality/valueGiven the lack of economic sensitivity to supply-side oil shocks and the strong response to shifts in oil demands, greater pressure on the domestic economy is likely when Vietnam increases its dependence on oil imports.

Food import demand with structural breaks, economic embargo and the COVID-19 pandemic in a wealthy, highly import-dependent country

PurposeQatar, a wealthy country with an open economy has limited arable land. To meet its domestic food demand, the country heavily relies on food imports. Additionally, the over three year-long economic embargo enforced by regional neighbors and the covariate shock of the COVID-19 pandemic have demonstrated the country's vulnerability to food insecurity and potential for structural breaks in macroeconomic data. The purpose of this paper is to examine short- and long-run determinants of Qatar's imports of aggregate food, meats, dairy and cereals in the presence of structural breaks.Design/methodology/approachThe authors use 24 years of food imports, gross domestic product (GDP) and consumer price index (CPI) data obtained from Qatar's Planning and Statistics Authority. They use the autoregressive distributed lag (ARDL) cointegration framework and Chambers and Pope's exact nonlinear aggregation approach.FindingsUnit root tests in the presence of structural breaks reveal a mixture of I (1) and I (0) variables for which standard cointegration techniques do not apply. The authors found evidence of a significant long-run relationship between structural changes and food imports in Qatar. Impulse response functions indicate full adjustments within three-quarters of a year in the event of an exogenous shock to imports.Research limitations/implicationsAn exogenous shock of one standard deviation on this variable would reduce Qatar's food imports by about 2.5% during the first period but recover after the third period.Originality/valueThe failure of past aggregate food demand studies to go beyond standard unit root testing creates considerable doubt about the accuracy of their elasticity estimates. The authors avoid that to provide more credible findings.

Analysis of Yields and Their Determinants in the European Corporate Green Bond Market

The green bond market helps to mobilize financial sources toward sustainable investments. Green bonds are similar to conventional bonds but are specifically designed to raise money to finance environmental projects. The feature of green bonds is the existence of greenium, or the lower yield compared to “conventional” bonds of the same risk. The relevance of the paper is underpinned by the mixed evidence on the existence of ‘greenium’, especially in corporate green bond markets; there has been limited research on the topic and a narrow focus on global, US, or Chinese green bond markets. Instead, the greenium in European debt markets remains underexplored. The objective of this study is to investigate the existence of greenium and its key determinants in European corporate debt capital markets, including the local markets of the United Kingdom (UK), France, Netherlands, and Germany. The sample included 3851 corporate bonds, both green and conventional ones, between 2007 and 2021 from 33 European countries. Linear regression was applied for the analysis. The results show that the climate corporate bonds in Europe are priced at a discount to the same-risk conventional corporate bonds. The magnitude of greenium is around 3 bps. Determinants of greenium include the presence of an ESG rating and belonging to the utility and financial industry. The remaining drivers of bond yields in the European corporate debt market are the credit quality (expressed by the level of credit rating), the coupon size, the bond tenor, the market liquidity, and macroeconomic variables (growth of gross domestic product and consumer price index). For the local corporate debt markets, our results are controversial. In all markets under consideration except for the UK and the Netherlands, we did not find sustainable evidence of greenium. The results of the research lead to a better understanding of the green bond market for investors, researchers, regulators, and potential issuing companies.

The social impact and risks of the COVID-19 pandemic crisis in Greece

The purpose of this paper is to investigate the effects of the COVID-19 pandemic on unemployment in Greece. The outbreak of the pandemic at the beginning of 2020 was an unprecedented phenomenon for the governments of all states, which, with the increase in cases, were called to take measures to limit the spread of the virus, which necessarily limited freedoms but also caused changes in lifestyle and the activities of people but also in the operation of businesses resulting in the disruption of labor relations (Francis-Devine et al., 2022). A large percentage of businesses were forced to suspend their operations and, in many countries, total lockdowns of short or longer duration were imposed. Some countries, of course, have chosen to act differently by imposing smaller local lockdowns or even none. In this paper, we will deal with the case of Greece, which acted completely differently, especially during the first period of the outbreak of the pandemic, with the first imposing a total lockdown from the appearance of the very first cases of the pandemic (Goniewicz et al., 2020). Using panel data, we will assess the interaction and correlation of the unemployment rate with a range of variables, such as the number of cases, inflation, gross domestic product (GDP) and consumer price index, to assess whether and to what extent the spread of the virus ultimately affected the rate of unemployment in these two countries.

Spatial Analysis of Individuals Life Satisfaction in Turkey Within The Context of Socioeconomic Factors

Özet
 
 Amaç: İktisat biliminin temel argümanlarından biri, kaynakların kıt, ihtiyaçların ise sınırsız olmasıdır. Genel olarak bireylerin yaşamdan beklentilerinin yüksek olabileceği düşünülse de fizyolojik, güvenlik gibi en temel ihtiyaçlarının karşılanması dahi bireylerin yaşam memnuniyet düzeylerini arttırabilmektedir. Bir ülkede sınır komşusu olan bölgelerin sosyoekonomik yapısı benzerlik gösterdiğinden bir bölgede yaşam memnuniyet düzeyindeki değişme, bu bölgeye sınır komşusu olan bölgelerde aynı yönde değişme oluşturacaktır. Bu kapsamda çalışmada bireylerin yaşam memnuniyet düzeyinin Türkiye’nin 26 alt bölgesinin (ikinci düzey Türkiye İstatistiki Bölge Birimleri Sınıflandırması -İBBS-) sınır komşu olan bölgelerinde yayılım gösterip göstermediği ve bireylerin yaşam memnuniyetini etkileyen faktörlerin mekansal veri analiziyle belirlenmesi amaçlanmıştır. 
 
 Yöntem: Çalışmada Türkiye’nin 26 alt bölgesinde bireylerin yaşam memnuniyet düzeylerinin mekansal bağımlılığı, 2013 yılı için mekansal veri analiziyle araştırılmıştır. Türkiye İstatistik Kurumu (TÜİK) tarafından yayınlanan yaşam memnuniyeti anketi, il düzeyinde sadece 2013 yılında yapılmıştır. Bu nedenle analiz 2013 yılı için gerçekleştirilmiştir. Analizde yer alan değişkenler için 2013 yılı TÜİK ve Sosyal Güvenlik Kurumu (SGK) verileri kullanılmıştır. Analiz sonuçlarına göre mekansal regresyon modellerinden mekânsal otoregresif model çalışma için en uygun model olarak belirlenmiştir. 
 
 Bulgular: SAR model sonucuna göre bireylerin yaşam memnuniyet düzeyi sınır komşusu bölgeler arasında yayılım göstermektedir. Bireylerin yaşam memnuniyet düzeyini ortalama günlük kazanç ve bölgenin aldığı iç göç pozitif yönde etkilerken; işsizlik oranı, yüksekokul ve fakülte mezunları, malvarlığına karşı işlenen suçlar ve şiddet suçları negatif yönde etkilemektedir. Yine SAR model sonucuna göre, kişi başına gayri safi yurt içi hasıla ve tüketici fiyat endeksinin bireylerin yaşam memnuniyet düzeyine etkisi bulunmamaktadır. 
 
 Sonuç: Bir ülkede bireylerin yaşam memnuniyet düzeyinin yüksek olması, ülkenin sosyoekonomik yönden gelişmişliğinin bir göstergesi olduğu kabul edilebilir. Bu nedenle bireylerin yaşam memnuniyetini etkileyen sosyoekonomik faktörlerin belirlenmesi önem arz etmektedir. Bir ülkede bireylerin yaşam memnuniyet düzeyinin sınır komşu olan bölgelerde yayılım göstermesi ise, bölgeler arasında sosyoekonomik yönden farklılıkların giderilmesinin önemini ortaya koymaktadır. 
 
 Özgünlük: Konuyla ilgili yapılmış çalışmalarda analiz yöntemi olarak çoğunlukla lojit ve probit modeller ve sabit etkili panel veri modelleri kullanılmıştır. Mekansal veri analiz yöntemi uygulayan çalışmalara rastlanmamıştır. Yine analizde suç türleri ve bölgelerin aldığı göç oranına bağımsız değişkenler olarak yer veren Türkiye için yapılmış çalışmalara rastlanmamıştır. Bu nedenlerle çalışmanın özgünlük oluşturduğu düşünülmektedir.

Impact of oil price and oil production on inflation in the CEMAC

There are different channels through which variations in international crude oil prices translate into changes in net-oil exporting countries' domestic prices. This article identifies two of these causal mechanisms, namely the pass-through effect and the Dutch disease effect. It intends to disentangle these two effects in the five oil producers of the Central African Economic and Monetary Community: Cameroon, the Republic of Congo, Chad, Equatorial Guinea, and Gabon. It also investigates the heterogeneity across countries in the face of international oil price and domestic oil production shocks based on a multiple time-series strategy covering the period 1995–2019. Applying Dynamic Ordinary Least Squares and Autoregressive Distributed Lag models, it concludes to the presence of a pass-through effect in Cameroon, Chad, and the Republic of Congo and of a Dutch disease effect in Equatorial Guinea. This contributes to the understanding of the relationships between international commodity prices and domestic consumer price variations but can also help policymakers in the CEMAC by assessing the vulnerability of its members toward external shocks.

An economic assessment of the impact of climate change on the Gambia’s agriculture sector: a CGE approach

PurposeClimate change and its imminent threat to human survival adversely impact the agriculture sector. In an impoverished country like The Gambia, economic costs of climate change are colossal. This study aims to establish a computable general equilibrium (CGE) model for The Gambia’s agriculture sector to examine the effects of climate change on crops, livestock and sea-level rise.Design/methodology/approachThis study used a CGE model with other climate change impact models to compute the impacts of climate change on The Gambia’s agriculture sector. The social accounting matrix calibrates the results from the various models, thereby generating the baseline results which exemplify a “steady-state” and policy shock results illustrating the medium- and long-term effects of climate change on the country’s agriculture sector.FindingsThe baseline results indicate the status quo showing the neglect of the agriculture sector due to limited investment in the sector. Hence, the sector is the “hardest hit” sector as a result of climate change. When the model factored in climate change in the medium term (2055) and long term (2085), the macroeconomic indicators of gross domestic product, national savings, wages, disposable income and consumer price index deteriorated, elucidating the vulnerability of the economy to climate change. The consumption of groundnuts, cattle and fish will decline by 5%, 5% and 4%, respectively, in the long term. However, the production of all agricultural commodities will decline by an average of 35% for the same period. The results for international trade show that exportation would decline while importation will increase over time. The general price level for agricultural commodities would increase by 3% in 2055 and 5% in 2085. Generally, the results manifest the severity of climate change in the agriculture sector which will have a multiplier effect on the economy. The impact of climate change would result in agriculture and economic decline causing hunger, poverty and human misery.Originality/valueThe caveat of this study revealed the nuances not captured by previous Gambian climate change studies, thus the novelty of the study.

Viscoelastic or viscoplastic theory (VGT #84): A comparison study of the influences on the gross domestic product (GDP), inflation rate, and consumer price index (CPI) in the USA resulting from consumer psychological reactions and spending behavior changes over 9-quarters during the COVID-19 pandemic period from Y2020Q1 to Y2022Q1 based on GH-method: math-physical medicine, especially the VGT energy tool (No. 674)

The author is a mathematician and engineer who has conducted medical research work over the past 13 years. Thus far, he has written 670 medical research papers. Beginning with paper No. 578 dated 1/8/2022, he wrote a total of 80 medical research articles using the viscoelasticity and viscoplasticity theories (VGT) from physics and engineering disciplines on 80 different medical problems with their associated data. These papers aim to explore some hidden biophysical behaviors and provide a quantitative understanding of the inter-relationships on a selected medical output (symptom) versus either singular input or multiple inputs (root causes, risk factors, or influential inputs). The hidden biophysical behaviors and possible inter-relationships exist among lifestyle details, medical conditions, chronic diseases, and certain severe medical complications, such as heart attacks, stroke, cancers, dementia, and even longevity concerns. The chosen medical subjects with their associated data, multiple symptoms, and influential factors are “time-dependent” which means that all biomedical variables change from time to time because body living cells are dynamically changing. This is what Professor Norman Jones, the author’s adviser at MIT, suggested to him in December 2021 and why he utilizes the VGT tools from physics and engineering to conduct his medical research work since then. From 1980 to 1981, the author attended a college in California for his MBA degree, emphasizing finance and marketing. In addition, he spent many years managing a successful high-tech semiconductor business in Silicon Valley, where it involved many key factors of economics and finance, such as gross domestic product (GDP), inflation rate, consumer price index (CPI), NASDAQ stock performance, price/earnings ratio (P/E ratio), various investment decisions, return on investments (ROI), etc. As a result, he has a strong background in money topics associated with finance and economics. In addition, during the 9 years from 2002 to 2010, he self-studied psychology and established 4 psychotherapy centers to take care of 200+ abused women and abandoned children. Therefore, he has accumulated a considerable amount of knowledge on psychological behaviors, especially in the field of clinical psychology of abused victims. During his recent medical research work using the tool of viscoelastic or viscoplastic behavior theory, he suddenly realized a strong similarity between medicine and economics. The behaviors and patterns of economics variables (inputs and outputs) he observed are comparable to the behaviors and patterns of medical variables he studied and researched (causes and symptoms) in terms of their curve shape & waveforms, fluctuation patterns, moving trends, physical behaviors, etc. For example, he has applied the candlestick chart or K-line diagram from Wall Street as an effective glucose representation tool in medicine. Most importantly, variables in both medicine and economics possessed the common “time-dependent” characteristics.

Viscoelastic or Viscoplastic Theory (VGT #84): A Comparison Study of the Influences on the Gross Domestic Product (GDP), Inflation Rate, and Consumer Price Index (CPI) in the USA Resulting from Consumer Psychological Reactions and Spending Behavior Changes over 9-Quarters During the COVID-19 Pandemic Period from Y2020Q1 to Y2022Q1 Based on GH-Method: MathPhysical Medicine, Especially the VGT Energy Tool (No. 674)

The author is a mathematician and engineer who has conducted medical research work over the past 13 years. Thus far, he has written 670 medical research papers. Beginning with paper No. 578 dated 1/8/2022, he wrote a total of 80 medical research articles using the viscoelasticity and viscoplasticity theories (VGT) from physics and engineering disciplines on 80 different medical problems with their associated data. These papers aim to explore some hidden biophysical behaviors and provide a quantitative understanding of the inter-relationships of a selected medical output (symptom) versus either singular input or multiple inputs (root causes, risk factors, or influential inputs). The hidden biophysical behaviors and possible inter-relationships exist among lifestyle details, medical conditions, chronic diseases, and certain severe medical complications, such as heart attacks, stroke, cancers, dementia, and even longevity concerns. The chosen medical subjects with their asso- ciated data, multiple symptoms, and influential factors are “time-dependent” which means that all biomedical variables change from time to time because body living cells are dynamically changing. This is what Profes- sor Norman Jones, the author’s adviser at MIT, suggested to him in December 2021 and why he utilizes the VGT tools from physics and engineering to conduct his medical research work since then. From 1980 to 1981, the author attended a college in California for his MBA degree, emphasizing finance and marketing. In addition, he spent many years managing a successful high-tech semiconductor business in Silicon Valley, where it involved many key factors of economics and finance, such as gross domestic product (GDP), inflation rate, consumer price index (CPI), NASDAQ stock performance, price/earnings ratio (P/E ratio), various investment decisions, return on investments (ROI), etc. As a result, he has a strong background in money topics associated with finance and economics.

VEC 모형을 활용한 지방 주택중개시장의 영향 요인 및 활성화 연구

The study analyzed the effects of changing economic and demographic variables such as population, interest rate and consumer price index on house brokerage markets by focusing on gradually sluggish housing markets in Jeollabuk-do For methods, a time series multiple regression analysis using Vector Error Correction Model (VECM) was employed in that the number of house brokerage and input variables have characteristics observed in a time series way. This study suggested the improvement schemes of housing brokage market as follows; First, it is necessary to take into account regional differences in terms of population movement, outflow, inflow and aging. Second, house brokerage markets in local cities are affected by gross regional domestic product and consumer price index so that it is important to take a look at changing commodity price as well as varying economic situation. As the patterns of economic development vary according to regions, it is necessary to consider this point from which house brokerage markets could be immensely affected. Third, the need to forecast the potential effects of urban regeneration new deal projects underway on house brokerage markets should be considered given regional differences. Lastly, the recession of house brokerage markets can be seen as natural as its value as investment goods is underrated in that there is a right balance between demand and supply of houses in economically advanced South Korea. Against this backdrop, developing both house brokerage markets and real estate management markets will be an important breakthrough like advanced countries.

Effects of exchange rate pass-through on inflation in Vietnam

The main purpose of this study is to investigate the effect of exchange rate pass-through (ERPT) on domestic price of goods and services in Vietnam under the impact of the interest rate and refinancing rate over the period 2014 to 2019. Unit root test and many Diagnostic tests are conducted before applying the Vector Auto Regressive (VAR) model. Estimation results indicate that exchange rate changes have a positive impact on domestic consumer price level means that an increase in the depreciation of Vietnam dong could cause an increase in domestic price, the degree of ERPT into domestic price level is smaller than interest rate and refinancing one. The study also indicates many problems existing in the actual situation in Vietnam. From those analysis results, the study has proposed monetary policy orientations to help stabilize prices and develop macroeconomics.

Asset allocation efficiency from dynamic and static strategies in underfunded pension funds

This study attempts to conduct a comparative analysis between dynamic and static asset allocation to achieve the long-term target return on asset liability management (ALM). This study conducts asset allocation using the ex ante expected rate of return through the outlook of future economic indicators because past economic indicators or realized rate of returns which are used as input data for expected rate of returns in the “building block” method, most adopted by domestic pension funds, does not fully reflect the future economic situation. Vector autoregression is used to estimate and forecast long-term interest rates. Furthermore, it is applied to gross domestic product and consumer price index estimation because it is widely used in financial time series data. Based on asset allocation simulations, this study derived the following insights: first, economic indicator filtering and upper-lower bound computation is needed to reduce the expected return volatility. Second, to reach the ALM goal, more stocks should be allocated than low-yielding assets. Finally, dynamic asset allocation which has been mirroring economic changes actively has a higher annual yield and risk-adjusted return than static asset allocation.

Economic Indicators Selection for Property Crime Rates using Grey Relational Analysis and Support Vector Regression

Features selection is very important in the multivariate models because the accuracy of forecasting results produced by the model are highly dependent on these selected features. The purpose of this study is to propose grey relational analysis and support vector regression for features selection. The features are economic indicators that are used to forecast property crime rate. Grey relational analysis selects the best data series to represent each economic indicator and rank the economic indicators according to its importance to the property crime rate. Next, the support vector regression is used to select the significant economic indicators where particle swarm optimization estimates the parameters of support vector regression. In this study, we use unemployment rate, consumer price index, gross domestic product and consumer sentiment index as the economic indicators, as well as property crime rate for the United States. From our experiments, we found that the gross domestic product, unemployment rate and consumer price index are the most influential economic indicators. The proposed method is also found to produce better forecasting accuracy as compared to multiple linear regressions.

Monetary Policy and Domestic Private Investment in Nigeria

This paper empirically examined the effect of monetary policy on domestic private investment in Nigeria from 1981 to 2018. In other to achieve our objectives, annual time series data of the dependent variable – domestic private investment (DPI) and independent variables – money supply (MS), government domestic debt (GDD), government domestic savings (GDS), interest rate (INT) and consumer price index (CPI) were collected from secondary sources like CBN Statistical Bulletin and WDI. Thereafter, the data were analyzed using descriptive statistics and the econometrics technique of Vector Error Correction Mechanism (ECM) method of analysis. The results of analysis indicated that a long run relationship exists among the variables. Furthermore, the paper revealed that money supply (MS), government domestic savings (GDS). interest rate (INT) and consumer price index (CPI) have a negative and insignificant effect on domestic private investment in the long run but interest rate is significant at 5%, while government domestic debt (GDD), has a positive and insignificant effect on domestic private investment (DPI) in the long run in Nigeria within the period. Based on the above findings, the paper recommends as follows: Expansionary monetary policy should be formulated that will reduce interest rate, encourage borrowings and savings. This will expand commercial banks and other credit granting financial institutions which will encourage real investment in the economy.

Government policies in a granular global economy

Using a granular model of international trade, we study the rationale and implications of various government interventions targeted at large individual firms. In antitrust regulation, governments face an incentive to be overly lenient towards domestic mergers in comparative advantage sectors. In trade policy, targeting individual foreign exporters rather than entire sectors minimizes the pass-through of import tariffs into domestic consumer prices, shifting the burden towards foreign producers. In industrial policy, subsidizing ‘national champions’ is generally suboptimal in closed economies as it leads to an excessive build-up of market power, yet it may become unilaterally welfare improving in open economies at the cost of the foreign consumers.